It seems to happen every year when tax season approaches. Tens of millions of individual and business taxpayers every year feel apprehension and sometimes outright fear over filing their returns and filling out their tax forms. Tax anxiety (tax-iety) can affect anyone. And while most people can deal with the issues associated with mild cases of this form of anxiety, for others it can be a more serious experience.
While tax anxiety is not akin to depression or clinical anxiety, it can lead to poor decision-making on the part of the taxpayer. For those who are dreading paying their taxes, the good news is that this form of anxiety can be managed when you have the right information.
What is Tax-iety -Tax Anxiety? IRS-FTB-EDD-CDTFA
Put simply, tax anxiety is the fear that millions of people feel when filing their taxes. As with most fear, it comes from the unknown. Because the taxes are being sent off to the government, a massive institution that has the power to oversee, audit, and take action against individuals for filing incorrect tax forms, the anxiety can seem quite real.
That's because most people in the US only interact with the federal government on relatively rare occasions. While you see the local and state governments more regularly, interactions with the federal authorities are few and far between.
For many people, filing their federal income taxes is the only direct contact they have with such authorities. And sending your taxes off to an entity that is as distant and large as the IRS can bring apprehension to most people, tax-iety.
But there is a difference between general apprehension and the type of fear that is felt by those who have tax anxiety. Understanding the fear and how to deal with it starts by examining the reasons why this form of anxiety occurs, its effects, and what you can do about it.
Reasons for Tax Anxiety – aka tax-iety IRS-FTB-EDD-CDTFA
There are many reasons why people feel tax anxiety. From the general stress that is felt from filing taxes to the belief that you may have made a mistake, these are the common everyday stresses that can be felt.
Making Mistakes: One of the most common causes of tax anxiety is the fear that you have made a mistake on your returns. Especially if you have received new information of income that you did not add to your tax filing.
In most cases, the IRS will simply send you a letter which informs you of the discrepancy. This means if you act promptly to address the issue, such as adding the recommended amount or submitting a new tax form it can be resolved quickly.
Keep in mind that the IRS is not interested in punishing every taxpayer for making mistakes. They are mostly interested in receiving the money that they believe is due.
The IRS has Made a Mistake: Another common source of tax anxiety is receiving notice from the IRS about an issue that does not exist. For example, the IRS claiming that you owe more money because of an issue with your tax filing.
However, the IRS is just as capable of making mistakes as you. The only difference is that the IRS consists of a massive bureaucracy, so it is possible that one section does not know what the other section is doing. This can lead to considerable stress if you have answered the request but are still getting letters from the IRS.
The common procedure is to call and contact the IRS yourself if you have received confirmation through the mail of your response. Do not panic and do not become even more stressed as a positive response from the IRS is generally all you need to know the situation has been resolved.
Such reasons can be handled through a few simple exercises in terms of both physical and mental tasks that can take your mind off the situation. However, there are reasons that are more serious than just worrying if your tax filing is correct. What follows are some of the more common reasons for the more serious tax anxiety felt during tax season.
Non-Filers tax-iety: Did you know that there are as many as 8 million people who do not file tax returns every year. There is a myriad of reasons why they do not file their taxes, but the most common include making relatively little money, the source of income is not traceable, or simply not understanding that they need to file their tax forms every year.
Even the IRS cannot trace everyone who does not file their tax returns. Which means as long as their current status remains the same, the chances of being caught may seem relatively small. However, with recent changes to IRS procedures along with changes in the lifestyle of those who do not file tax forms, they may suddenly find themselves being notified.
But even if they are not notified for not filing, the stress can be such that many taxpayers with unfiled tax returns seek our professional help. It is understandable because the fear of being caught can be quite overwhelming for many.
Back Taxes tax-iety: Unpaid tax debt leads to more than just tax anxiety. It can bring tax levies, garnishments, and liens that can greatly diminish your income until the back taxes are paid.
Because the IRS is not a loan agency or bank, the legal action they can take to garnish wages or levy your bank is greatly increased. The result is that many who owe back taxes can feel a considerable amount of fear and apprehension that may lead to making even worse decisions.
If not filing tax returns was bad enough, owing money to the federal government may lead to an even worse feeling of fear and anxiety. This can have detrimental effects on the health and wellbeing of those who want to pay their back taxes but cannot.
Tax Auditstax-iety: Being audited is arguably the most stressful of all tax-oriented situations. Such audits can be quite intimidating and personal. It only increases the stress felt by the individual who may feel trapped by the situation.
Worse, the tax audit process is often maddening given the sheer size of the IRS and the difficulties in handling the situation without the proper representation. It's little wonder that so many who are audited and feel tax anxiety seek professional help to reduce the stress.
Our Whittler, Los Angeles, CA tax firm assist taxpayers with unfiled tax returns, back taxes, IRS & State audits, call us today at 1-877-78-TAXES [1-877-788-2937].
Issues Associated with Tax Anxiety & Stress IRS-FTB-EDD-CDTFA
People go through stress every day. Stress is actually health in small, manageable amounts as it provides motivation to accomplish tasks and extra energy to complete projects. But too much stress can be detrimental to your health in more ways than you might realize.
Tax anxiety aka tax-iety is more than simply the fear that you feel. It can have real health complications if you do not lower the stress levels quickly. Just a few of the many issues associated with increased stress over a long period include the following.
- Cardiovascular Issues such as High Blood Pressure, Heart Attacks, or Stroke
- Increased Risk of Anxiety or Depression
- Insomnia
- Migraines
- Ulcers & More
Such complications may seem far more serious that what simple tax anxiety may bring. But adding stress to your life brings health issues that can be quite daunting. There are methods you can use to deal with the stress that include what to do about the stress itself to dealing with the source of tax anxiety, namely correcting the issues with your taxes.
What to do About Tax Anxiety? IRS-FTB-EDD-CDTFA
Whether you are facing one or more of the three main tax anxiety causes, finding ways to deal with the stress starts with the right knowledge. Knowing what to do can greatly reduce the anxiety that you feel.
Start Early: Don't wait until the last minute to deal with the issues surrounding your tax situation. The earlier you take action, the less stress you will have to deal with in the future, the lower the risk of suffering from serious health problems.
If you are in the early stages of tax anxiety because you are filing taxes for the first time in year, knowing that you may owe back taxes, or seriously suspect that a tax audit may be in your future, then you need to start dealing with it as soon as possible.
Waiting until the last minute only makes the stress worse. Not only have you built up more stress from putting off the inevitable, but you are also increasing the chances of making an even bigger mistake or oversight which brings on even more stress.
The faster you start the process of filing your taxes, the better. Even the action of filing your taxes can help reduce the stress. Considering that most stress comes from anticipation; you can get past that step quickly by going ahead and preparing your tax filing.
Break down the task into manageable portions. This means spreading out the preparation of your taxes over days to ensure that you do not overlook any details. By making daily progress over a few days instead of trying to do your taxes at once, you can cut down on the tax anxiety.
If you are not comfortable doing your taxes alone, then hire a tax professional, Mike Habib helps individual and business taxpayers. That will help reduce the tax-iety stress even more as they can do the work for you.
Know What is Happening: If you have filed your taxes and are facing back taxes or a tax audit, then you should arm yourself with information. Knowing what to do can really help lower the stress. Because now you can make the best-informed decisions about what to do next.
If you know that you are facing back taxes, start making plans to work with the IRS to pay them. The IRS is primarily interested in collecting the money they believe is owed to them. Which means that they have programs that can have you paying off your back taxes over time without wage garnishment. While not every solution may be available, knowing what you can do leads to making proactive decisions which in turn lowers the tax anxiety.
Exercise & Meditation: Sometimes you cannot help the tax anxiety you feel even when taking the proper actions. Exercise is one of the best ways to deal with stress. It provides the mind with a distraction from the issues at hand while reducing the potential damage the stress can cause to the body. For those who already exercise, adding meditation can be of great benefit as well.
You do not have to join a gym or purchase any equipment. Walking is a great stress reliever both in terms of working the muscles and providing the mind with a distraction from tax anxiety. Meditating just a few minutes a day can also bring your mind to a peaceful place which helps reduce stress.
Seek Professional Assistance IRS-FTB-CDTFA-EDD Tax-iety
Tax professionals are here to help you. They can provide the right course of action so you can make the best-informed decisions about what to do when facing tax anxiety. From filling out your tax forms to providing proper representation when faced with an audit, a tax professional should be the first person you turn to in such situations.
Hiring a reputable tax professional from the start will greatly help in reducing any tax anxiety, tax-iety, that you might feel. It is the same feeling as hiring a lawyer to defend you against a lawsuit or obtaining physical protection when you go into areas that are less safe. Knowing someone is by your side can greatly reduce tax anxiety.
For example, if you have not filed your taxes in years, the tax professional will explain what the consequences may be. The IRS does have programs that allow for the filing of taxes for previous years that will correct the situation.
If you have not filed your taxes in years but are going to do so this tax season. If you have back taxes that need to be paid. Or if you are facing a tax audit, then call a tax professional right away. By providing you with the proper guidance, advice, and representation, they can help lower the stress you are feeling today.
Our Whittler, Los Angeles, CA tax firm assist taxpayers with unfiled tax returns, back taxes, IRS & State audits, call us today at 1-877-78-TAXES [1-877-788-2937].
